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Telstra delivers 85 percent of NBN speeds during peak

More signs the land grab is over?

Telstra is buying more connectivity virtual circuit (CVC) bandwidth for NBN users, today claiming it now delivers “more than” 85 percent of the maximum speed of services during peak times.

In a further sign that the NBN retail market is shifting towards competing on quality rather than price alone, Telstra used its half-year results to disclose how close its NBN customers can get to the wholesale speed tier that they are on.

“On speeds, we have recently increased our capacity further to deliver 80 percent of the maximum speed during peak times, ahead of ACCC guidelines,” CEO Andy Penn said in a statement.

“For the past three months our network has delivered an average of more than 85 percent of the maximum speed during peak times.”

Telstra did not disclose its average revenue per user (ARPU) from NBN customers, but Penn said they were "up” on numbers previously reported.

He said an admission by NBN Co CEO Bill Morrow earlier in the week that wholesale ARPU was unlikely to hit $52 by 2021 had not caused Telstra to change its own retail ARPU predictions.

Penn indicated Telstra would watch the market to determine which direction NBN ARPUs would trend in the future.

“In the long term it really depends on how that plays out in the market,” he said.

“My comments have always been that what’s critical for customers in the long term has been that wholesale prices are set at a level which is affordable to customers, and clearly the significant increase of wholesale prices [as the NBN migration occurs] isn’t going to lead to affordability for customers.”

Penn said NBN Co’s new temporary pricing on the 50Mbps tier had been a good thing for Telstra, and indicated the telco was keen to see more permanent price model changes come into effect.

“I think if we can move to a better wholesale pricing model in the longer term it’s going to be much healthier for customers - because RSPs will be able to invest in great product - and for the operators as well,” he said.

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